Cheseapeake Energy has not been a paragon of corporate governance these days. So no one should be surprised by the fact that Reuters is now reporting that Chesapeake has instituted "tin parachutes" for approximately 1,6000 mid-level employees. A tin parachute is a program in which a large number of mid-level employees are given payaments upon a change of control as a takeover defense. In the event there is a change of control and then employees with these tin parachutes are let go, then a large number of relatively small payments are triggered. In Chesapeake's case the estimate cost would be $140 million. By raising the back end costs of restructing a takeover target, it becomes more expensive for potential acquirers. Peoplesoft famously instituted a tin parachute while trying to fend off Oracle.

According to Reuters, Chesapeake has not disclosed the tin-parachutes in its SEC filings. That's strange. I did a quick search and couldn't come up with any description, but I imagine the folks over at Footnoted.com can find it if it's been filed.